The setting drives pretty much everything in this novel. The Handmaid's Tale is set in a time when extreme religious fundamentalists have taken over the US. They have even changed the name of the country to The Republic of Gilead. It is a theocracy; it gives all power to the men who adhere to the very strict religious constraints that are not only legal, but required. The powers that be cannot control the thoughts of the people, but they do control virtually everything else. The choices of the characters are dictated by the new government. Women have no say whatsoever in their fate, even the women who supported the theocracy. The main character, now known as Offred (of Fred; her own name was stripped from her) has had her husband and daughter taken from her. She now has no option but to serve in the Commander and Serena Joy's household, being a handmaid. This entails not only servitude, but, because she is fertile and the couple she lives with is not, forced sex in order to give the couple a child. Offred has no choices or actions open to her, legally. The actions and choices of the Commander and Serena Joy are also limited. Serena Joy appears to have a former career as a televangelist; this is no longer permitted, as women are not allowed to work. The Commander, though seemingly the one in charge, is also limited to choices and actions permitted by the theocracy--at least in theory. It turns out that even the people who wanted to establish Gilead got more than they bargained for, and there is an underground of illicit activity that exists.
The government, though it does not now control the thoughts of the people, hopes to in the future. It is trying to eliminate the memory of pre-Gilead culture by not allowing contact between the servants. The servants at this time remember pre-Gilead times; in the future, that will not be so.